Section 147

Section 147 — the law in short

What the courts have decided on section 147, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Sanand Properties P Ltd v Jt CIT Supreme CourtHelps department
  My company is a member of an AOP and takes 35% of the AOP's gross sale proceeds under the AOP deed. We showed it as an exempt share of the AOP's profit. After a survey the AO reopened two years and now says it is revenue. Can he reopen, and is the money taxable in my hands?
  No on the reopening challenge and no on the exemption. Where the assessment order shows the Assessing Officer never applied his mind to the character of the receipt at all, there is no opinion to change, and material coming out of a s.133A survey that reveals the true nature of the receipt is tangible material for s.147. On the merits the Court read Clause 7 of the AOP deed itself and held that a member's entitlement to 35% of gross sale proceeds, taken upfront and untouched by the AOP's expenses, is not a share of profit but a diversion of the AOP's receipts by overriding title, taxable in the member's hands as a business receipt. Two Revenue appeals were allowed and the assessee's appeal dismissed.
• Union of India v Rajeev Bansal Supreme CourtCuts both ways
  Your notice was issued in the 1 April to 30 June 2021 window. Was it saved by TOLA, or is it dead?
  Saved, but only within limits. TOLA extends the time limit for issuing the reassessment notice and for the sanction under s.151. It does not extend anything else, and every other defence survives — including the surviving-period computation for your own assessment year.
• Mangalam Publications v CIT Supreme CourtHelps taxpayer
  You filed without books because they were seized. Is that a failure to disclose?
  Not where the primary facts were disclosed some other way. The duty to disclose does not extend beyond primary facts; once they are disclosed, the burden shifts to the officer to draw the right inferences. The reassessments were quashed.
• Dy. CIT v U.K. Paints (Overseas) Ltd Supreme CourtHelps taxpayer
  A section 153C assessment was made on me after a search on someone else, but nothing incriminating about me was found. Does the Abhisar Buildwell rule protect me too?
  Yes. The Supreme Court dismissed a batch of Revenue appeals, holding that where no incriminating material was found during the search — either from the assessee or from the third party — the assessments under section 153C were rightly set aside by the High Court. The Court declined to interfere with those judgments. It did, however, record on the Revenue's request, made on the strength of Abhisar Buildwell, that it remains open to the Revenue to initiate reassessment proceedings under sections 147 and 148 in accordance with law, if that is permissible under the law.
• PCIT v Abhisar Buildwell P Ltd Supreme CourtCuts both ways
  Search assessment for a year already completed, but nothing incriminating was found. Can the officer still add?
  No — not under s.153A. For completed or unabated assessments the addition must rest on incriminating material found in the search. But the Court preserved the department's power to reopen those years under ss.147 and 148 instead.
• Mansarovar Commercial P Ltd v CIT Supreme CourtHelps department
  My company is registered outside the taxable territory but run from Delhi. Where is it resident?
  Where it is actually run. The Supreme Court held that the residence of a company turns on de facto control and management, not on the place of registration: five companies incorporated under the Registration of Companies (Sikkim) Act, 1961 were resident in India because the management and control of all five was wholly situated in Delhi, at the office of a chartered accountant. The appeals were dismissed and the Delhi High Court's decision affirmed.
• CIT v Mansukh Dyeing and Printing Mills Supreme CourtHelps departmentSuperseded by amendment
  The firm revalued its land and credited the surplus to the partners' capital accounts. Is that taxable?
  Under the old s.45(4), yes. The Supreme Court held that crediting a revaluation surplus to partners' capital accounts on a reconstitution is in effect a distribution of the assets to the partners and a transfer chargeable to capital gains, because the enhanced balances were immediately available for withdrawal — and two partners did withdraw.
• Union of India v Ashish Agarwal Supreme CourtHelps department
  What happened to the thousands of s.148 notices issued under the old rules after the law changed in 2021?
  Reported as treating those notices as s.148A(b) show-cause notices instead of quashing them, with directions on how they were to proceed.
• Dy. CIT v M.R. Shah Logistics Pvt Ltd Supreme CourtHelps department
  Another company declared the cash it put into my share capital under the Income Declaration Scheme. Does that stop the Department reopening my assessment on the same share money?
  No. The Supreme Court set aside the Gujarat High Court's order quashing a section 148 notice and allowed the assessing officer to complete the reassessment. The immunity in section 192 of the Finance Act 2016 runs to the declarant alone and only for limited purposes; a declaration by Garg Logistics could not immunise the assessee, a non-declarant. The reopening was in any case based on material seized in the search on an accommodation entry provider and correlated with the assessee's Registrar of Companies filings, not on the declaration. Where there is objective tangible material, the sufficiency of that material cannot dictate the validity of the notice.
• New Delhi Television Ltd v DCIT Supreme CourtCuts both ways
  Reopening beyond four years — how much are you actually required to have disclosed?
  The primary facts, and no more. Disclosure of secondary facts is not required. But if the department wants to use an extended limitation window, it must say so in the notice or the reasons.
• ITO v TechSpan India (P) Ltd Supreme CourtHelps taxpayer
  What actually counts as a 'change of opinion'?
  Formulating an opinion and then changing it. To constitute a change of opinion the earlier assessment must, expressly or by necessary implication, have expressed a view on the subject now being reopened.
• Sky Light Hospitality LLP v ACIT Supreme CourtHelps department
  The reassessment notice was issued in the name of my old private limited company, which had already been converted into an LLP and dissolved. I am told that makes the notice void. Is that always right?
  Not always, and this is the decision the Revenue will cite against you. The Delhi High Court dismissed the writ petition, holding that the issue of the notice in the name of the dissolved private limited company was an error and technical lapse which caused no prejudice, that there was no doubt and debate that the notice was meant for the petitioner and no one else, and that human errors and mistakes cannot and should not nullify proceedings which are otherwise valid — that being the effect and mandate of section 292B. The Supreme Court dismissed the special leave petition with the words: 'In the peculiar facts of this case, we are convinced that wrong name given in the notice was merely a clerical error which could be corrected under Section 292B of the Income Tax Act.'
• CIT v S. Goyanka Lime & Chemical Ltd Supreme CourtHelps taxpayer
  Is 'Yes, I am satisfied' enough for the sanctioning authority to write?
  No. Recorded that way, the satisfaction is mechanical and shows no sign that the officer's reasons were examined. The s.148 notices were held unsustainable and the department's SLP was dismissed.
• Dy CIT v Zuari Estate Development & Investment Co Ltd Supreme CourtHelps department
  My return was only processed under section 143(1) and now the officer wants to reopen it. Can I say he is changing his opinion?
  No. The Supreme Court held that where a return is accepted under section 143(1), no assessment order is made and no opinion is formed, so the change of opinion objection simply does not arise. The point was held to be squarely covered by Rajesh Jhaveri Stock Brokers. The Bombay High Court had quashed the reopening notice without addressing this contention at all, and its judgment was set aside. The Tribunal's order, which had merely followed the High Court, went with it, and the appeal was remitted to the Tribunal to be decided on merits.
• CIT v Chhabil Dass Agarwal Supreme CourtHelps department
  Can I go straight to the High Court against an income-tax order instead of filing the statutory appeal?
  Ordinarily no. The Supreme Court held that the Income-tax Act supplies a complete machinery for assessment and reassessment, and an assessee cannot abandon that machinery and invoke Article 226. The exceptions are narrow and have to be pleaded and made out — an order passed otherwise than in accordance with the enactment, in defiance of fundamental principles of judicial procedure, under repealed provisions, or in total violation of natural justice.
• ACIT v Dhariya Construction Co Supreme CourtHelps taxpayer
  The only thing behind my reopening notice is the Valuation Officer's report. Is that enough?
  No. The Supreme Court held that the opinion of the Valuation Officer is not by itself information on which an assessment can be reopened. The officer has to apply his mind to whatever material he has collected and form his own belief; adopting the valuer's figure is not that.
• CIT v Kelvinator of India Ltd Supreme CourtHelps taxpayer
  The officer looked at this exact issue in the original assessment and now wants to look again. Can he?
  No. Reopening needs tangible material. A mere change of opinion is not a ground, and where a s.143(3) assessment was made the officer is presumed to have applied his mind — so re-examining the same material is review, which the Act does not permit.
• CIT v Greenworld Corporation Supreme CourtCuts both ways
  The Assessing Officer passed the assessment after being told what to do by the Commissioner. What happens to that assessment, and to a later section 263 order on it?
  An assessment passed on the dictates of a higher authority is without jurisdiction and a nullity. And a Commissioner exercising section 263 cannot use that order to direct reopening of other assessment years; his revisional jurisdiction is confined to the year before him.
• CIT v Alagendran Finance Ltd Supreme CourtHelps taxpayer
  A reassessment was done in between. Does the two-year clock for s.263 restart from it?
  Not for an item the reassessment never touched. For that item, limitation runs from the ORIGINAL assessment order, because the doctrine of merger does not apply where the subject matter is different.
• ACIT v Rajesh Jhaveri Stock Brokers P Ltd Supreme CourtHelps department
  My return was only processed under 143(1). Does that stop the department reopening it later?
  No. An intimation under s.143(1) is not an assessment, so it does not bar the officer from later starting reassessment proceedings.
• Raymond Woollen Mills Ltd v ITO Supreme CourtHelps department
  The department says the court will not look at whether its reasons are any good. Is that really the test at the reopening stage?
  Largely yes. When the validity of the initiation of reassessment is under challenge, the court asks only whether there was prima facie some material on which the department could reopen. Whether that material is sufficient or correct is not examined at that stage; it is argued in the reassessment. The appeals were dismissed and the reopening was upheld.
• CIT v Nirbheram Daluram Supreme CourtHelps department
  The first appellate authority has enhanced my assessment using items the Assessing Officer never looked at. Can it do that, or has it gone beyond its jurisdiction?
  It can. The Supreme Court held that the appellate power under section 251 is not confined to matters the Assessing Officer considered. Following the three-judge decision in Kanpur Coal Syndicate and the three-judge decision in Jute Corporation of India, the first appellate authority has plenary powers, coterminous with those of the Assessing Officer: it may confirm, reduce, enhance or annul the assessment, may do what the Assessing Officer could do, and may direct him to do what he failed to do. The Act places no restriction on that power, so ten further hundi credits of Rs 2,30,000 were properly added.
• Sri Krishna Pvt Ltd v ITO Supreme CourtHelps department
  I disclosed my hundi loans in the return and the officer accepted them. He now says the same lenders were bogus in the next year. Can he reopen?
  Yes. The Supreme Court held that a false disclosure is not a full and true disclosure. Whether a loan shown in the return is genuine is itself a material fact, not an inference to be drawn by the officer, so an assessee who records bogus loans has failed the duty section 147(a) imposes. That the officer could have investigated at the time, and did so in the following year, does not relieve the assessee of that duty. At the notice stage the enquiry is only whether reasonable grounds exist, not whether escapement is proved. The appeals were dismissed with costs.
• Phool Chand Bajrang Lal v ITO Supreme CourtHelps department
  I produced my books and a confirmation for the loan at the original assessment. The officer now says he has learnt the lender was a name lender. Can he reopen on that?
  Yes. The Supreme Court dismissed the assessee's appeal and upheld the reopening. Where specific, reliable and relevant information comes into the officer's possession after the assessment, exposing the falsity of what the assessee said, that is not a change of opinion or a fresh inference from the same material - it is acting on fresh information. Producing books and a confirmation letter for a transaction later shown to be bogus is not a true and full disclosure. The officer's failure to investigate the doubt during the original assessment does not take away his jurisdiction. Burlop Dealers was confined to its own facts.
• CIT v Sun Engineering Works (P) Ltd Supreme CourtHelps department
  Since the assessment is open again, can you use the reassessment to raise claims you missed the first time?
  No. Reassessment proceedings are for the benefit of the revenue. You cannot reopen matters concluded in the original assessment, or press claims you failed to make or which were rejected — that would turn the reassessment into an appeal in disguise.
• R.K. Upadhyaya v Shanabhai P. Patel Supreme CourtHelps department
  My reassessment notice was posted on the last day of the limitation period but reached me three days later. Is it time barred?
  No. The Supreme Court allowed the Revenue's appeal and vacated the Gujarat High Court's order. Under the 1961 Act a clear distinction is made between issue of a notice and service of it. Section 149 says no notice under section 148 shall be issued after the limitation has lapsed, so once a notice is issued in time jurisdiction vests in the officer. Section 148(1) requires service before the order of assessment is made: the mandate is that reassessment shall not be made until there has been service. Service is therefore a condition precedent to the order, not to jurisdiction. Here the notice went by registered post on 31 March 1970, the last day, and that sufficed.
• Kishinchand Chellaram v CIT Supreme CourtHelps taxpayer
  They have a letter from a bank that you have never seen. Can they use it against you?
  No. Material collected behind your back and relied on against you must be disclosed to you, with an opportunity to meet it. Because the bank's letter was never shown to the assessee, the addition could not stand.
• Indian and Eastern Newspaper Society v CIT Supreme CourtHelps taxpayerSuperseded by amendment
  My assessment is being reopened because an internal audit party told the officer he applied the wrong head of income. Is an audit party's opinion on the law information for reopening?
  No. The Supreme Court held that the opinion of an internal audit party of the Income Tax Department on a point of law is not information within section 147(b). Law, for this purpose, must be created by a formal source - a competent legislature or a competent judicial or quasi-judicial authority - and an audit party performs administrative or executive functions with no power of judicial supervision over the officer's quasi-judicial acts. The part of an audit note that merely points to the law the officer overlooked is information; the part expressing the audit party's own opinion on how that law applies is not, and cannot be taken into account.
• Rajinder Nath v CIT Supreme CourtHelps taxpayer
  An appellate order in my firm's case said the officer is free to assess the amount in the partners' hands. Does that lift the limitation bar for assessing me?
  No. The Supreme Court held that the words finding and direction are limited in meaning. A finding must be one necessary for the disposal of the particular case, of the particular assessee and for the particular year, and directly involved in that disposal; an incidental finding will not do. A direction must be express, necessary for the disposal, and within the power of the authority making it. Saying the officer is free to take action leaves the matter to his discretion and is not a direction at all. Section 153(3)(ii) does not enlarge jurisdiction; it only raises the bar of limitation.
• Parashuram Pottery Works Co Ltd v ITO Supreme CourtHelps taxpayer
  The Income-tax Officer allowed me too much depreciation because he worked it out from his own records and forgot the initial depreciation. Years later he wants to reopen. Is that my failure to disclose?
  No. The Supreme Court quashed notices under section 148 issued more than four years after the assessment years. The mistake was the Income-tax Officer's own: he had computed depreciation from departmental records and overlooked the ceiling that the aggregate of all depreciation cannot exceed original cost. The assessee's duty is to disclose the primary facts fully and truly; it does not extend to telling the officer what inference to draw or instructing him on the law. Nothing in the returns was shown to be incorrect. Without the omission or failure limb, the officer had no jurisdiction beyond four years.
• ITO v Lakhmani Mewal Das Supreme CourtHelps taxpayer
  How strong does the officer's material have to be before he can reopen?
  Strong enough to have a live link with the belief. Material that is vague, indefinite, distant or far-fetched will not do. The statute says reason to believe, not reason to suspect.
• Gemini Leather Stores v ITO Supreme CourtHelps taxpayer
  The Income-tax Officer found my undisclosed drafts during the original assessment, questioned my partner about them, and then did nothing. Can he reopen years later saying I failed to disclose them?
  No. The Supreme Court quashed the notice. The Income-tax Officer had himself discovered the drafts, put them to a partner of the firm, recorded in his best judgment assessment order that the money must belong to the firm, and then failed to bring the amounts to tax. Once he had all the primary facts it was for him to make the enquiries and draw the inferences. His failure to do so was plainly an oversight, and he could not use section 147(a) to remedy an error resulting from his own oversight. Section 143 was cited in the notice; the proceedings were quashed.
• CIT v Gillanders Arbuthnot & Co Ltd Supreme CourtCuts both ways
  I sold shares to a company I control for an agreed price and took the company's own shares, at face value, in satisfaction. Can the officer compute my capital gain on what those shares were really worth?
  No, on these facts. The Supreme Court held that where the transaction is a sale for a price, the full value of the consideration is the price bargained for, not the market value of what was received in satisfaction of it. The agreement said the partners would sell and the company would purchase for Rs 75 lakhs; the clause allotting shares merely provided the mode of satisfying that price. That the firm gained by taking shares issued at face value did not turn the sale into an exchange. Market value can be substituted only where the first proviso applies, and it did not.
• Sheo Nath Singh v Appellate Assistant Commissioner Supreme CourtHelps taxpayer
  The recorded reasons for reopening my assessment say only that I am believed to have made secret profits and believed to have received a large sum. Is that reason to believe?
  No. The Supreme Court quashed the notices. The words reason to believe mean the belief of an honest and reasonable person on reasonable grounds; the officer may act on direct or circumstantial evidence but not on mere suspicion, gossip or rumour. He acts without jurisdiction if the reason for his belief does not exist or is not material or relevant to the belief the section requires, and the court can always examine that, though it cannot investigate the sufficiency of the reasons. Here the recorded reasons stated no material fact at all - they were themselves expressed as beliefs, an obvious self-contradiction.
• Chhugamal Rajpal v S.P. Chaliha Supreme CourtHelps taxpayer
  The sanctioning authority just wrote 'yes' and signed. Is that a sanction?
  No. The officer had set out no reason for concluding it was a fit case, and the Commissioner merely noted the word yes and signed beneath it. Neither s.147 nor s.151 was satisfied, so the officer had no jurisdiction.
• CIT v Bhanji Lavji Supreme CourtHelps taxpayer
  I placed all my primary facts before the officer and he dropped the proceedings. Can a later officer reopen the assessment because he takes a different view of those same facts?
  No. The Supreme Court held that once the assessee has fully and truly disclosed the primary facts necessary for assessment, the officer cannot start reassessment on a change of opinion. He may have drawn a wrong legal inference from the disclosed facts, but that does not make him competent to reopen. The burden is also placed where it belongs: if failure to disclose is alleged, it is for the officer to establish it, not for the assessee to prove there was no concealment. The assessee owes no duty to instruct the officer on questions of law, such as that profits were embedded in receipts.
• Baladin Ram v CIT Supreme CourtHelps department
  I made unexplained investments after the close of my accounting year. Which year can the officer tax them in, and can he reopen an earlier year to do it?
  The financial year, and yes he can reopen. The Supreme Court held that where income is found to come from an undisclosed source, for which no accounts are kept and no previous year has been chosen, the only way it can be assessed is as income of the ordinary financial year. So investments of about Rs 27,000 made in the Sarpat and bamboo business between December 1943 and February 1944 fell in the financial year 1943-44 and were assessable for 1944-45, not 1945-46. Disclosing them in the 1945-46 proceedings was no disclosure for 1944-45, so section 34(1)(a) was attracted.
• Calcutta Discount Co Ltd v ITO Supreme CourtHelps taxpayer
  How much am I actually required to disclose — and can they reopen because the officer drew the wrong conclusion?
  You must disclose the primary facts fully and truly. Drawing inferences from those facts is the officer's job. Getting that inference wrong is not your failure and does not justify reopening.
• Biswajit Deb v Union of India High CourtHelps taxpayerJudgment not reachable
  The recorded reasons admit the AO had no time to verify my transactions. Is the reopening valid?
  No. The Gauhati High Court quashed the s.148 notice on two independent grounds: an officer who records that he could not identify the transactions for want of time has formed no reason to believe, and the s.151 approval was mechanical.
• Genesys International Corporation Ltd v ACIT High CourtHelps taxpayerNo later treatment found
  We claimed s.10AA on our SEZ unit without first setting off the losses of our other units, and the officer now wants to reopen the assessment to undo it. Is that a good reason to reopen?
  No. The Bombay High Court held that the very premise of the reopening - that the s.10AA deduction should have been given only after setting off the losses of the ineligible units - is in the teeth of the Supreme Court's decision in CIT v Yokogawa India Ltd, so it could not found a reason to believe income had escaped. The other two grounds also failed: the six month repatriation condition was introduced only by the Finance Act 2024 and did not apply to assessment year 2017-18, and the fact that the claim was made in the return under 'any other amount allowable as deduction' rather than in the s.10AA schedule was explained by the return utility itself. The notice was quashed as a change of opinion.
• Gstaad Hotels Pvt Ltd v Assistant Commissioner of Income Tax High CourtHelps taxpayerNo later treatment found
  My section 35AD deduction was examined and allowed in scrutiny. Four years later the department wants to reopen and treat part of it as revenue expenditure so the loss runs under section 72 for eight years instead of indefinitely under section 73A. Can it?
  Not on these facts. The Bombay High Court quashed the s.148 notice, the two orders disposing of objections and all consequential proceedings, holding that where the original assessment was completed under s.143(3) and the reopening is beyond four years, the first proviso to s.147 requires a failure to disclose fully and truly all material facts, and a bald assertion of such failure without identifying which fact was not disclosed will not do. The Court expressly did not decide whether the expenditure was capital or revenue.
• Saurav Chachra v CBDT High CourtHelps taxpayerNo later treatment found
  I have a stay on my demand and they still adjusted my refund against it. Can they do that?
  Not on these facts. The Revenue conceded that a refund of Rs. 14,80,270 for AY 2025-26 had been set off against the AY 2018-19 demand even though recovery of that demand stood stayed under s.220(6), and the Court found force in the submission that the action was illegal and arbitrary and the authorities' recourse perfunctory, directing the refund to be released with s.244A interest within four weeks. It gave no reasons beyond accepting that submission: it did not hold that adjustment is a mode of recovery, did not consider s.245, and did not formally quash the adjustment.
• Sanjay Kumar Bijay Kumar v PCIT High CourtHelps taxpayerNo later treatment found
  The same cash deposits were already reassessed and accepted at nil. Can they reopen them again?
  No. The Orissa High Court held that where an earlier s.147 proceeding examined these very deposits, found them disclosed and assessed at NIL, and that order went unchallenged, a second reassessment on identical material is a change of opinion and an impermissible review.
• Sapphire Foods India Ltd v ACIT High CourtHelps taxpayerNo later treatment found
  The officer has reopened my scrutiny assessment because the audit party disagreed with what he allowed. Is that a fresh look or a change of opinion?
  On this decision, a change of opinion. Where the Assessing Officer had all the relevant material during the original scrutiny assessment, a reassessment driven by an audit objection on that same material is an impermissible review, and reopening on the same material is not permitted. The Court also held the notice barred by limitation because the extended period was unavailable in the absence of a failure to disclose material facts.
• PCIT v Agroha Fincap Ltd — an accommodation-entry case falls within exception (h) of the CBDT circular, so the monetary limit does not save the assessee High CourtHelps departmentNo later treatment found
  The tax effect in the department's High Court appeal is below the circular limit. My client says the appeal must go. Is that the end of it?
  Not if the case is within one of the circular's exceptions. The Delhi High Court, on a review petition, held that where the case of the Revenue before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entries, it falls within exception (h) of the circular dated 15 March 2024 — 'cases involving organised tax evasion including cases of bogus capital gain/loss through penny stocks and cases of accommodation entries' — and the appeal is maintainable without regard to the tax effect. The review petition was dismissed.
• Deloitte Consulting India Pvt Ltd v Assessment Unit, NFAC High CourtHelps taxpayerNo later treatment found
  Your APA year has been reopened and the officer has himself re-examined whether you complied with the APA. Can he do that without a compliance audit by the Transfer Pricing Officer?
  No. Rule 10P places the compliance audit of an APA with the Transfer Pricing Officer having jurisdiction over the assessee, for each year covered by the agreement. The assessment unit had no jurisdiction to examine APA compliance on its own or to make a reassessment on that footing, and the addition of Rs 106,47,00,730 it made on that basis was beyond jurisdiction. The reopening failed independently on the s.151 sanction and because the notice was issued by the jurisdictional officer rather than the faceless assessing officer.
• PCIT v Rajesh Suresh Chopra High CourtHelps taxpayerNo later treatment found
  If an estimate on the disputed purchases cannot be avoided, is there a High Court figure I can point to?
  Yes, on these facts. The Gujarat High Court dismissed the department's appeal against a Tribunal order that had confined the addition on roughly Rs 116.50 crore of alleged accommodation-entry purchases to 6 per cent, holding that no substantial question of law arose because the questions proposed were already answered by a coordinate bench, which had held 6 per cent of bogus purchases to be fair and reasonable. It is a percentage a High Court has let stand, not a rule — the figure follows the facts, and the department's contrary line on whole-invoice additions is unaffected.
• PCIT v Drisha Impex (P) Ltd High CourtHelps department
  The Tribunal gave me a small percentage addition on disputed purchases. Can the department get the whole disallowance back on appeal?
  Yes, where the file is empty. The Bombay High Court set aside the Tribunal's 3% estimate and restored the Assessing Officer's disallowance of the whole of the disputed purchases under s.69C, and the assessee's SLP was dismissed. What decided it was a list of documents that were not produced: no evidence of actual delivery of material, no supplier confirmations, no audited accounts, no quantitative details and no correlation between the purchases and the sales.
• PCIT v Kanak Impex (India) Ltd High CourtHelps department
  The officer says my purchases are accommodation entries. Can he add the whole purchase, or only a percentage?
  The whole of it, if you cannot show the purchases were real. The Bombay High Court set aside the Tribunal's order restricting the addition to a 12.5% profit estimate and restored the Assessing Officer's disallowance of the entire Rs 20.06 crore under s.69C, and the Supreme Court dismissed the assessee's SLP. The profit-element line only runs where the purchases themselves are accepted as having happened.
• Bhatia Propcon Pvt Ltd v DCIT (Delhi High Court) — citing section 50C when section 43CA was the right provision does not defeat the reassessment High CourtHelps departmentNo later treatment found
  The reopening notice says my sale below circle rate attracts section 50C, but I am a developer and the floor sold was stock in trade, so section 50C cannot apply. Does that error destroy the notice?
  No. The Delhi High Court held that sections 50C and 43CA both contain a deeming provision imputing to the asset transferred a value ascribable to it even where it is sold below the circle rate — the first for capital assets, the second for assets other than capital assets — so the Assessing Officer had sufficient reason to believe income had escaped assessment. A misapprehension as to which of the two applied was not a jurisdictional error invalidating the section 148 proceedings, and the writ petition was dismissed.
• Sonansh Creations P Ltd v ACIT High CourtHelps taxpayerNo later treatment found
  The officer says I took accommodation entries and I say I received nothing. Must he have material that the entries exist before he reopens?
  He must. The Delhi High Court set aside a s.148A(d) order and the consequent notice where the information was that eleven entities controlled by an entry operator had given the company fictitious loans, the company denied receiving anything from them and disclosed the bank accounts it operated, and the officer never referred to any material showing that the money had in fact come into those accounts. The Court rejected the contention that at the s.148A(d) stage the officer need form no opinion on the genuineness or veracity of the information; he must be reasonably certain that the alleged entries exist, though he need not conclusively decide that they are accommodation entries. Liberty was reserved to issue a fresh notice if material is found.
• International Hospital Ltd v DCIT High CourtHelps taxpayerNo later treatment found
  The department is now citing Mahagun Realtors to say an assessment on the amalgamating company is curable. Has the Supreme Court moved away from Maruti Suzuki?
  On the Delhi High Court's considered view in this batch, no. Mahagun Realtors turned on the conduct of that assessee — who suppressed the amalgamation at search, filed a return in the amalgamating company's name recording 'not applicable' against business reorganisation, and litigated throughout in that name — and did not dilute or strike a discordant chord with Maruti Suzuki. Where the successor did tell the department of the merger and the notice or order still went out in the dead company's name, the defect remains fatal.
• Paani Foundation v DCIT High CourtHelps taxpayerNo later treatment found
  The Assessing Officer has reopened an old year saying my trust could not claim provisioned expenditure as application because s.11 requires the sum to be actually paid. Does that rule apply to years before AY 2022-23?
  The Delhi High Court, at the notice stage, said it was prima facie unable to sustain the assumption of jurisdiction under s.148 on that reasoning, because the Explanation requiring a sum to be treated as applied in the previous year in which it is actually paid was inserted only by the Finance Act 2022 and would not govern AY 2017-18. This is an interim order in a writ petition that is still pending; there is no final adjudication.
• Hexaware Technologies Ltd v ACIT High CourtHelps taxpayerPartly overruled — read this first
  Your s.148 notice came from your own local officer, not from the faceless unit. Does that matter?
  In Bombay, yes. After the CBDT scheme notified under s.151A on 29 March 2022, only a Faceless Assessing Officer acting through automated allocation can issue a reassessment notice. There is no concurrent jurisdiction, and a notice from the jurisdictional officer was quashed.
• Champa Impex P Ltd v Union of India High CourtHelps departmentNo later treatment found
  The AO made no enquiry before issuing my 148A(b) notice. Does that kill the reopening?
  No, on the Calcutta view. The Division Bench read the words 'if required' in s.148A(a) as giving the Assessing Officer a discretion, so the absence of a prior enquiry does not by itself vitiate the notice.
• Sevensea Vincom P Ltd v PCIT High CourtHelps taxpayerNo later treatment found
  They reopened AY 2016-17 in 2022 for under Rs 50 lakh. Is the notice time-barred?
  Yes. The Jharkhand High Court held the three-year period for AY 2016-17 ended on 31 March 2020, and because the Department itself alleged escapement of only Rs. 39,21,450 the extended ten-year window in s.149(1)(b) was unavailable. The whole proceeding was without jurisdiction.
• Meet Lalwani v ITO High CourtHelps taxpayer
  I filed the death certificate and they still issued the 148 notice in my mother's name. Is it valid?
  No. The Madhya Pradesh High Court quashed the s.148 notice and the s.148A(d) order. Once the Department knew of the death, issuing the notice in the deceased's name was a failure to acquire jurisdiction, and ss.292B, 292BB and 159 do not cure it.
• PCIT v DSG Papers (P) Ltd High CourtHelps taxpayer
  The addition rests on statements of ex-employees and third parties I was never allowed to question. Is the assessment good?
  The additions were deleted, but read the High Court decision for what it is. The Chandigarh Tribunal directed deletion of the additions in all five years, holding that the assessee had not been allowed to cross-examine the persons on whose statements the Assessing Officer relied and that the evidence was internally contradictory - invoices said to have been destroyed were recovered from the residence of an ex-president against whom the company had filed an FIR before the search. The Punjab and Haryana High Court dismissed the revenue's appeal, but its order is two sentences long and gives no reasons of its own: it adopts a detailed judgment of even date in a companion appeal, ITA-38-2023, which is not on indiankanoon and is not available in a subscription case-law database.
• Thorapadi Urban Co-op Credit Society Ltd v ITO High CourtHelps taxpayerHigh Courts differ
  I have received a s.148A(b) notice and a s.148A(d) order saying my society's s.80P(2)(d) deduction on interest from a co-operative bank has escaped assessment. Can I challenge the notice itself rather than fight through the reassessment?
  In this case yes. The Madras High Court, in writ petitions against s.148A(b) notices, s.148A(d) orders and s.148 notices, held that a co-operative society registered under the State Co-operative Societies Act remains a co-operative society within s.2(19) whether or not it carries on banking, so interest from a co-operative bank qualifies under s.80P(2)(d); because the impugned orders were passed without considering that, they were set aside and the notices quashed.
• Pacific Energy Private Limited v ITO High CourtHelps taxpayerNo later treatment found
  The reassessment cannot increase my tax at all because I am assessed on book profit anyway. Is there anything in the Act that lets me have the proceedings dropped rather than fight them?
  Yes — s.152(2). Where an assessment is reopened under s.147, an assessee who has not impugned any part of the original assessment order under ss.246 to 248 or s.264 may claim that the proceedings be dropped on showing that he has been assessed on an amount not lower than what he would rightly be liable for even if the income said to have escaped had been taken into account. On that footing the Bombay High Court held the officer had no jurisdiction to reopen and quashed the notice and the order rejecting the objections.

The 60 strongest entries are summarised here. The other 110 entries are listed in full below, and each has its own page.

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.